The ideas floated within a month of Silicon Valley Bank’s collapse on March 10, 2023, range from calls to tweak banking regulations to a major overhaul of the government’s oversight of the banking system.
I’m a finance professor who previously worked for two major banks and was an economist at the Federal Reserve. Based on what I’ve learned from the banking crises that have occurred in the past 40 years, I’d put all the banking reform proposals under consideration into five categories.
1. Stronger supervision
Silicon Valley Bank reportedly ignored six separate warnings from the Federal Reserve Bank of San Francisco that it had too little cash on hand and was engaging in risky practices. So calls for stronger bank supervision and regulation should come as no surprise.
Any such reforms would at least, in part, reverse changes from a law Congress passed in 2018 that loosened some banking regulations.
Previously, the government had to pay especially close attention to banks with at least US$50 billion in assets. Among other things, it needed to subject them to stress tests – in which the authorities assess whether banks have the ability to respond to hypothetical economic shocks – by having enough cash on hand to meet relatively strict capital requirements.
The 2018 law raised the cutoff for what counts as a “systemically important” bank to $250 billion in assets, thus allowing many banks, including SVB, to avoid these more stringent regulations.
Sen. Elizabeth Warren of Massachusetts and Rep. Katie Porter of California have introduced legislation in the Senate and the House of Representatives that would simply repeal the 2018 law, returning the threshold to $50 billion.
Major banking trade groups, such as the Bank Policy Institute, which advocates on behalf of its large-bank members, have argued that the 2018 law was not a major factor in the failures of SVB and Signature Bank.
The role that deposit insurance plays in staving off and alleviating banking crises could also change.
The Federal Deposit Insurance Corp. was only supposed to insure accounts of up to $100,000 during the 2008 financial crisis. But instead, it covered nearly all depositors, uninsured as well as insured, in most bank failures that occurred at that time.
“Is it $2 million? Is it $5 million? Is it 10 million?” she said in a television interview.
But those lawmakers have so far stopped short of calling for the FDIC to commit to always fully covering all losses among customers who experience losses when bank failures cause their deposits to vanish – rather than doing so on a case by case basis.
FDIC Chair Martin J. Gruenberg told the Senate Banking Committee during a recent hearing that the insurer plans to release its own proposals on May 1.
3. ‘Modified deposit payoff’
Other proposals go further.
For example, William Isaac, who chaired the FDIC from 1978 to 1986, is calling for the government to insure all non-interest-bearing checking accounts, regardless of size. But he also has a recommendation that might potentially discipline banks that run into trouble.
Isaac distinguishes between deposits that are essentially investments, such as certificates of deposit that people use for long-term savings purposes, and, say, a checking account a customer maintains primarily for basic transactions.
Investors with large sums of money held in CDs are generally wealthy individuals who can either assess financial risks on their own or with input from a paid adviser. People with CDs also have an incentive to leave them with the bank, because withdrawing the money tied up in them before maturity can mean paying a penalty or forfeiting the high interest rates that make them attractive investments.
Isaac also advocates returning to the way uninsured deposits – currently, those above the $250,000 mark – were treated in the 1980s. He calls this the “modified deposit payoff” model.
In resolving a bank failure, the FDIC would cover the full cost of compensating customers with uninsured deposits that don’t pay any interest, yet give uninsured depositors certificates worth 80% of their uninsured funds.
“This reform would protect business accounts that are essential to keeping the economy moving and would reduce substantially the risk of panics,” he wrote.
4. ‘Ring-fencing’
The most comprehensive proposals that call for restructuring the banking system would use what’s known as a “ring fence” model.
Since 2019, British banks have had to segregate their retail banking activities from their presumably riskier investment banking and international lending.
The most radical of these proposals would lodge all insured deposits in “narrow banks” which would be allowed to hold only cash and U.S. Treasury securities.
All bank lending activity would occur outside of narrow banks, perhaps in finance companylike firms funded with uninsured borrowing and capital instruments such as stocks and bonds.
Banks are typically required to set aside a portion of their deposits as reserves held either as cash or deposits at their local Federal Reserve bank. However, the Fed reduced that share to zero in March 2020 – effectively eliminating the requirement altogether.
Critics of the narrow-bank model point out that this approach would drastically reduce the amount of money banks could lend. As a result, systemic risks would shift from real banks into “shadow banks” – securities firms, hedge funds and other credit intermediaries that face less regulation and supervision. Shadow banks contributed to the 2007-2009 global financial crisis, according to the International Monetary Fund.
5. Compensation clawbacks
At the heart of the debate about banking reform is “moral hazard.” That’s a concept regarding how insurance can create an incentive to take bigger risks when people, institutions and even countries realize they won’t bear the full cost of that risk.
One way to reduce risks in this context is to make bank executives bear some of the costs when the banks they run fail.
A bipartisan group of senators have introduced a bill to do just that. It would require regulators to claw back compensation, including the bonuses and stock awards paid to bank executives in the five years preceding a failure.
In my view, it’s too early to tell whether policymakers will make minor adjustments or opt for more significant reforms.
One thing that I hope all policymakers will keep in mind is that there are trade-offs between the financial stability of banks and market discipline. Offering too much government support – such as insuring all liabilities in the event of a bank failure – creates incentives for banks and their customers to ignore risks or to engage in risky behavior.
This article was updated to clarify Robert Litan’s contributions to the debate over banking reform.
California’s Medicaid Experiment Spends Money to Save Money — And Help the Homeless
Angela Hart
SAN DIEGO — Sporting a bright smile and the polished Super Bowl ring he won as a star NFL player in the late 1980s, Craig McEwen doesn’t fit the archetype of someone teetering on the brink of homelessness.
Evicted from his San Diego County apartment last July, McEwen — who endured repeated concussions during his six seasons in the NFL — scoured housing listings for anything he could afford.
Working as a part-time groundskeeper at a golf course for $15 an hour, his frantic search turned up nothing. So, feeling overwhelmed by rents pushing $3,000 a month for a one-bedroom apartment, he made a plan: move into his truck or rent a storage container to live in — an alternative he turned to when he was previously homeless in 2004.
McEwen is hopeful that a massive health care initiative in California offering new, specialized social services will help him get back on his feet. He is one of nearly 145,000 low-income Californians enrolled in CalAIM, an endeavor Gavin Newsom, the state’s Democratic governor, is spearheading to transform its Medicaid program, called Medi-Cal, into a new kind of safety net that provides housing and other services for people who are homeless or at risk of becoming homeless and have complicating conditions like mental illness or chronic disease that can make it difficult to manage life.
California launched the initiative in early 2022, rolling it out quietly, with health insurers and community groups scrambling to provide social services and benefits that fall outside traditional health care. It’s a five-year, $12 billion social experiment that Newsom is betting will eventually cut soaring health care spending in Medi-Cal, the largest Medicaid program in the country with 15.5 million enrollees.
The state is contracting the work to its 23 Medi-Cal managed-care health insurance companies. They are responsible for delivering a slew of new benefits to the most vulnerable enrollees: not only those with housing insecurity, but also people with mental health or addictive disorders; formerly incarcerated people transitioning back to society; seniors and people with disabilities; children in foster care; and Californians who frequent hospital emergency rooms or are admitted often to short-term skilled nursing facilities.
While only a sliver of the state’s Medi-Cal patients are enrolled in CalAIM, tens of thousands of low-income Californians could qualify for the new benefits. They’re eligible for help in finding housing and for paying rental move-in costs like security deposits.
But the help goes beyond housing. The state is also providing the most at-risk patients with intensive case management, alongside pioneering social services — such as healthy home-delivered meals for diabetes patients and mold removal in homes of patients with severe asthma.
Top state health officials say that with such an ambitious program — using Medicaid to help solve homelessness and combat chronic disease — they expected the rollout to be bumpy. After 2026, when the initiative’s funding ends, the state plans to prove the experiment works and permanently adopt the benefits. Meanwhile, other states are closely watching California, hoping to learn from its successes and failures.
“California is a leader, and it’s always experimenting in new and interesting ways,” said Dr. Georges Benjamin, executive director of the American Public Health Association. “What it can do is provide proof of concept, and then this can grow to other states.”
Insurers, in essence, are building a new health care workforce, contracting with nonprofit and for-profit organizations to enroll the most vulnerable — and expensive — Medi-Cal patients. They’re hiring social workers and case managers to find those who rack up extreme health care costs in hospital emergency rooms, nursing homes, prisons, jails, and mental health crisis centers.
As Newsom sees it, the immense investment will pay off for taxpayers. Targeting people cycling in and out of costly institutions will reduce health care spending, he argues, while also helping people get healthy. State health officials say 5% of high-need Medi-Cal patients account for roughly half of all health care spending in the low-income health care program.
The most important currency in pulling off this massive health care experiment is trust. And that is being built on the ground, with community outreach workers scouring hospitals and homeless encampments, for example, to find those eligible for CalAIM.
The most at-risk Medi-Cal patients are being linked to specialized teams deployed under a new entitlement benefit at the heart of the initiative called “enhanced care management.” While other services like covering security deposits are optional, this is not. Health insurers are required to accept people who are most in need and provide a wide range of health and social services.
It can be simple things like arranging an Uber to get to a medical appointment or buying a computer for an enrollee looking for a job. Or purchasing a bike for a low-income kid. But it also involves intensive, one-on-one work that can require case managers to take patients to get an identification card, make nighttime phone calls to ensure patients are taking medications, and hunt down available apartments.
“This is the missing piece, and it’s the hardest work — the most costly work,” Newsom said in an interview with KFF Health News. “People on the streets and sidewalks, they’ve lost trust. They’ve become socially isolated. They’ve lost connection, and so developing that is so foundational.”
‘My Own Prison’
McEwen, who was a tight end for the NFL team now known as the Washington Commanders and later for the San Diego Chargers, was hailed as a “legacy.” But playing professional football took an extreme toll.
“My position was to block for the quarterback, and back in the day, you were allowed to hit people in the head,” McEwen said, recalling regular concussions on the field that he’d snap himself out of by sniffing ammonia packets. He helped lead the Washington team to a Super Bowl victory in 1987, but in the decades since, his health has deteriorated.
McEwen has struggled for years to find regular work while dealing with thoughts of suicide, anger, forgetfulness, and depression that he says stem from traumatic brain injuries sustained during his football career. At 57, he endures continual pain from ruptured disks in his neck and spine, along with shortness of breath from severe heart disease.
He’d holed up in his apartment for years, with curtains nailed to his windows, drowning his pain with alcohol. “I basically created my own prison,” he said.
After he was evicted last July, a longtime friend swooped in to let him stay temporarily in a spare bedroom at his family’s house just outside San Diego. But McEwen’s financial and emotional struggle to find stable housing hasn’t ended.
“We don’t call it fear. Us ballplayers, we call it excitement,” McEwen said on a rainy morning in early March, his eyes swelling with tears. “I’m excited. I know what’s at stake. My life is at stake.”
Housing instability is just one part of it. He’d often forget to take his medications for high cholesterol and clogged arteries. He felt paralyzing anxiety and his brain was so scrambled he’d miss important doctor appointments — a side effect, he said, of the concussions.
McEwen knew he needed help.
He’d learned from a friend that California was helping Medi-Cal patients with not just medical needs but also social services, and he started making calls, insisting on getting in. “I said wait, you’re giving people a coach? Someone who can make appointments for me and go to my doctor visits with me?”
Weeks after receiving his eviction notice, his Medi-Cal insurer, Molina Healthcare, connected him with a personal care manager, whom McEwen calls “my advocate, someone who can teach me how to do for myself and give myself a life worth living.”
But who gets in the program is often a roll of the dice, depending largely on which Medi-Cal insurance company a person is enrolled in. Persistence plays a big role.
Despite early glimmers of hope, the rollout has been chaotic. Providers on the ground scramble to find any available housing for enrollees. Groups implementing the initiative say inadequate funding and dire health workforce shortages have severely constrained their ability to serve all those in need. And enrollment by health insurers is uneven, with some quickly approving new benefits for their members while others are denied. Some insurers provide on-the-spot Uber rides for doctor appointments while others offer only a bus pass.
“What is being offered is insufficient, and this program is not set up to support those who are actually the most vulnerable and need the most intensive support,” said Nancy Behm, associate director of CalAIM for a San Diego nonprofit called People Assisting the Homeless, or PATH.
Operating under contracts with Blue Shield of California, Molina Healthcare, and Health Net, PATH launched intensive case management and housing services in January 2022. But it has since stopped providing intensive case management benefits largely due to a lack of sufficient funding to do the grueling work of connecting with homeless people living in encampments. “We’re hitting barriers on every front,” Behm said.
Newsom, with his soaring political ambitions, is promising to help the most vulnerable Californians. Termed out in 2026, speculation is mounting that the two-term governor is eyeing a presidential run, and he’s using health care as a core issue to elevate his national profile. In reality, his Medi-Cal initiative is falling far short.
“This is an extremely ambitious program, but it doesn’t come close to helping the entirety of the population it’s targeting,” said Doug Herman, who worked for former President Barack Obama and former Los Angeles Mayor Eric Garcetti. “This isn’t a policy solution big enough to really make a dent in homelessness.”
No Walk in the Park
On a brisk morning in late February, Jeannine Nash pulled into the drive-thru of a Jack in the Box in Chula Vista, just south of San Diego. She dug in her wallet to find $8.17 for 10 breakfast sandwiches to hand out to homeless people on her regular rounds visiting encampments.
“It helps me to come out here before work, to get an idea of what the needs are,” Nash said as she approached a nearby homeless woman slumped over on a sidewalk who had nothing with her but a brand-new walker and hospital discharge paperwork tucked in a plastic bag.
Nash is director of referrals for Serene Health, a for-profit health care company that is one of nearly 500 provider organizations being paid to link homeless people or those at risk with intensive case management, housing, and other services.
A recovering addict herself, Nash said her life experience has helped her connect with people living outside and struggling with substance use disorders. She figures out how to get those who appear resistant to accept services. “So many people are distrustful of authority,” said Nash, who has a son who is homeless.
“This is very, very dear to my heart,” Nash said. In her decades since becoming sober, she has gained deep experience getting the people most at risk of spiraling deeper into crisis into treatment beds and even apartments. She’s cultivated relationships with housing and nursing home agencies so she can quickly identify openings.
But her job comes with extraordinary challenges. She often has to level with people living outside, telling them there is simply nowhere for them to go. “There’s just not enough beds or housing out there,” she said. “And if you don’t have an income, it’s not going to happen.”
Nash handed the homeless woman in the doorway two sandwiches, coaxing her to eat. The woman, Christina Gallegos, 38, was suffering from extreme liver damage due to chronic drinking and had crawled the few blocks from Scripps Mercy Hospital in Chula Vista, where she was discharged the night before.
She had been in the emergency room, her hospital discharge paperwork showed — one of several ER trips she’d made in the past month. She was given the walker but couldn’t walk and dragged it into a doorway for shelter.
“We see this all the time. It’s getting really bad,” Nash said, texting her contacts to find a bed for Gallegos. “She’s definitely eligible. It’s just finding somewhere for her to go that is going to be hard.”
Gallegos has Medi-Cal but hasn’t been enrolled in the new benefits California is offering. She was among an estimated 8,500 homeless people identified in San Diego County in 2022, a 10% increase since 2020.
San Diego County is massive and populous, and while homeless encampments permeate suburban enclaves like Chula Vista, homeless people are largely clustered in San Diego’s downtown neighborhood and its parks.
One popular place to pitch a tent is Balboa Park near the San Diego Zoo. Its canyons and sprawling green lawns are peppered with tent communities, whose inhabitants plead for help from community groups. Many hang on to business cards from homeless outreach workers in hopes of scoring a shelter bed or permanent housing. While some people do get housing, many feel as if outreach efforts amount to broken promises.
One man, David Lloyd, pulled from his pocket a phone number for an outreach worker from the homeless services provider PATH, who told him that he was on a waiting list for housing but that he could be waiting in the queue for years.
“It’s a big list,” said Lloyd, 66. “I just want to get off the streets. I’m tired of the cops harassing me all the time.”
Cally Wood, 35, said she is addicted to fentanyl and has been on the waiting list for housing for more than a year. “It just feels really impossible,” she said. “There’s nothing affordable.”
Health insurance executives, including Martha Santana-Chin, Medi-Cal president for Health Net in California, said Medi-Cal managed-care plans are making progress in helping get people off the streets and into services. Yet she acknowledged the initial rollout falls short.
“We just don’t have the housing supply that we need,” Santana-Chin said, “to be confident that all of these folks who need support and services are going to get permanently placed.”
Hampered by Sweeps
Across the region, sweeps of homeless encampments are common and becoming part of everyday life for people living outside. Deteriorating and unsanitary conditions on the streets fuel public frustration.
Newsom has ratcheted up the practice of clearing encampments, arguing that people dealing with homelessness should not be allowed to live outdoors, despite a dearth of alternatives. He’s allocating state funding to cities and counties to remove tents from streets and sidewalks and move people into any shelter or housing available. San Diego Mayor Todd Gloria, also a Democrat, is unapologetic about adopting the approach.
“We’re doing the cleanups that are necessary for public safety,” Gloria told KFF Health News. “These conditions are unsanitary, and it puts people’s health and safety at risk, and it leads to people dying. Some people disagree with me under the guise of caring for these individuals, but the sidewalk is not a home.”
Outreach workers on the ground, however, say the enforcement crackdown only makes their jobs harder. One of the most critical goals of the new Medi-Cal initiative is to regularly visit people on the streets, build relationships with them, and help them with health care needs, all while preparing them for housing — if it becomes available.
“This really takes a lot of time. Sometimes you start with just bringing someone socks or a bottle of water. It can take 70 encounters for someone to accept our help,” said Andrea Karrer, an outreach worker with PATH. “But that time is what allows you to build trust with someone, and when they have to constantly move, you have to find that person, and sometimes start all over.”
And the disruptions ultimately cause people without housing to get sicker and visit the ER more often, she and other outreach workers said.
“When you have to move every two or three days, getting to the doctor or staying on medication is not the biggest priority. You’re in survival mode,” Karrer said.
A Labor-Intensive Effort
Serene Health is one of hundreds of providers enrolling Medi-Cal patients into intensive case management. Together, they have signed up 108,000 patients statewide so far, according to California’s Department of Health Care Services, which administers Medi-Cal. An additional 28,000 are receiving the new housing services such as security deposit payments and help identifying affordable housing.
“A lot of the stuff we’re doing is just really new to health care,” said Jacey Cooper, the state’s Medicaid director. She said that health insurers are offering housing services in all 58 counties, yet she acknowledged that the need exceeds capacity.
“It takes time for that infrastructure to come to fruition,” Cooper said of the challenge of identifying housing for Medi-Cal patients who frequent hospital ERs. “We are in a massive education moment of even making sure people understand who’s eligible and how to refer, and educating the entire delivery system, from hospitals to providers.”
Meanwhile, Newsom is asking the Biden administration for permission to add another housing benefit that would cover up to six months of direct rent payments.
Veronica Ortiz, a lead care manager for Serene Health, has Craig McEwen on her roster of about 60 patients — a large caseload that is difficult to manage.
But Ortiz bubbles with compassion and energy and said working with patients like McEwen has given her even more drive to make a difference. The work is arduous, but McEwen is quickly becoming more independent, she said.
“When we come into their lives, we’re strangers, so we have to spend a lot of time meeting face-to-face with people and helping with anything they need, otherwise they’re not going to trust us.”
But help didn’t come fast enough for Donna Fontenot, a San Diego County resident who is being evicted from her apartment this month. Her landlord told her she had to leave following repeated ER trips, hospitalizations, and skilled nursing home stays stemming from an initial fall in 2022 that left her in a wheelchair.
“I’m petrified and absolutely panicking, I have nowhere to go,” Fontenot said. With one hospitalization alone costing an average of $18,000 in California, Fontenot, who is on Medi-Cal, has racked up high health care costs.
She has been hospitalized eight times since March 2022, she said. And on five occasions, her injuries to her feet and legs were so extreme that she needed placement in a nursing home.
Yet her Medi-Cal insurer, the San Diego-based Community Health Group, instituted a rule that to qualify for some housing services, she must have a child under 18. So she isn’t receiving housing assistance that could help her. She is, however, enrolled in intensive case management. But she was not aware of that until KFF Health News informed her.
“I feel like I won the lottery,” she said. “Is it going to help me?”
Her care manager hasn’t been as involved in her life as Ortiz has been with McEwen. Fontenot continues to search on her own for housing, and recently asked to be switched into Serene Health to get more hands-on assistance. “I’ve never needed help like this before. I feel so broken,” she said in tears. “Where am I going to go?”
Today, Ortiz is helping McEwen search for housing. She also has focused on helping him get his heart condition under control and find more stable work.
In March, he landed a job as a security guard patrolling sporting events, including at football stadiums. And he scored a hard-to-get surgery appointment for late this month to help unclog the arteries in his heart.
“Before Veronica, I was waiting to die. I was eating and drinking to die. But she showed up for me. Somebody cared about me. And that gave me the courage to share with her what my dream would be,” McEwen said. “I thought I needed football to be loved — then I’d be worth it.
“But I know now that my true purpose is to be of service and to be there for my daughter. I decided to get back on the field, instead of sitting on the sidelines.”
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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As Second Chance Pell Grant program grows, more incarcerated people can get degrees – but there’s a difference between prison-run and college-run education behind bars
As of 2014, only 15% of people earn a college degree or postsecondary certificate either before or during their incarceration. Among U.S. adults as a whole in 2021, 53.7% earned such degrees.
Joshua Dankoff, who works as director of strategic initiatives at the nonprofit Citizens for Juvenile Justice, collects data on prison education. He found that in Massachusetts, where I live,
of the 5,300 people in Department of Correction custody are on college or vocational education waitlists. Only 213 are enrolled in some form of postsecondary education. Just 77 are enrolled in a bachelor’s program.
The Biden administration is expanding Second Chance Pell access by adding 73 schools, including 24 historically Black colleges and universities. Beginning July 1, 2023, up to 200 higher education programs will serve incarcerated students.
As the director of the Emerson Prison Initiative at Emerson College, I believe it’s important to distinguish between the different educational programs offered within prisons.
There are three main types. The first includes high school equivalency and vocational programs run by departments of correction. The second is educational non-credit-bearing programs offered by outside volunteer organizations, such as gardening clubs or Toastmasters. Third are credit-bearing degree programs run by outside colleges and universities, like mine.
Prison-run education programs
Many U.S. states such as California, New York and Massachusetts provide adult basic education, or ABE. Some also mandate access to English language instruction. ABE is meant to improve literacy and numeracy and offer the opportunity for incarcerated people to get a high school equivalency diploma. Many prisons also offer computer classes and other supplemental, non-credit-bearing courses.
Researchers call educational opportunities like these “prison education.” The programs are designed and carried out by correctional staff.
Although prison education programs may strive for universal benchmarks such as passing HiSET or GED high school equivalency tests, the guidelines for who can participate are set by prison administrators in partnership with state agencies.
For example, in Massachusetts, the Department of Elementary and Secondary Education provides curricular standards and funding for adult basic education and testing both within and outside of prison. Currently, in Massachusetts are on the waitlist for ABE. And while the state Department of Correction received funding for just under 200 ABE spots per year in recent years, it did not request funding for the next five years, suggesting that fewer people will have access to prison education.
Further, while incarcerated young people under age 22 with an identified disability and no high school diploma have a right to special education services, Dankoff analyzed Massachusetts data and found that only a fraction of young people in this situation actually receive these services. This is largely because jails and prisons do a poor job identifying young people with special education needs. It is also because the systems are oriented toward punishment rather than education.
College-run programs in prison
Prisons also allow education programming through outside partnerships with colleges and universities. Students in “college in prison” programs are usually enrolled into college-level degree-granting programs, including certificates, associate and bachelor’s degrees. These are the types of programs that will grow under the Pell Grant expansion.
Many colleges and universities that bring their programming inside prison walls try to provide an education for incarcerated students that is comparable to what they provide traditional college students. Educators from the outside come into the prison to teach. The programs often offer library research support, accessibility services and academic advising as well – in line with best practices for colleges in general. However, they must adapt to censorship restrictions within prisons, as well as limited internet and technology access, along with a host of additional regulations.
Power of language
In my experience, many prison educators are dedicated to the transformational power of education, just like their college-in-prison counterparts.
However, another small but I believe important difference is that prison-run programs typically refer to incarcerated students as “prisoners” or “inmates,” continuing Department of Correction language choice. In contrast, programs like the Emerson Prison Initiative refer to the people we work with as “students,” “applicants” or “students who are incarcerated.” This language treats incarcerated students with respect and dignity, which I’ve argued is central to student success and well-being.
The expansion of Pell Grants to more incarcerated people offers an opportunity to make college in prison more available while also maintaining best practices in this rapidly growing field. Such practices include little things, like the labels we use to refer to students, and big things, like ensuring that those who draw Pell Grants enroll in rigorous programs where they get a quality education and earn a degree.
Prior to the GPT-4 benchmarks being released, a good number of researchers were saying all the AI excitement was mostly hype, and that we are nowhere near these LLM approaching natural human language capabilities in anything but the most simple applications.
After GPT-4 I think there are more people who worried about where this is going faster than I think a lot of people imagined it will be going. As processing speeds increase and the sheer volume of data ingested starts to approach heretofore unseen levels, I think we’re really not ready for this. We can’t even, as a society, manage to get a handle on legislating and adjudicating, much less being able to predict where AI is taking us and how we should (or should not) use it.
Charlie Warzel (“Galaxy Brain”), one of the only truly reliably trenchant, useful and interesting writers in the often disappointingly mediocre Atlantic Magazine, has some thoughts from himself and others:
There’s always been tension in the field of AI—in some ways, our confused moment is really nothing new. Computer scientists have long held that we can build truly intelligent machines, and that such a future is around the corner. In the 1960s, the Nobel laureate Herbert Simon predicted that “machines will be capable, within 20 years, of doing any work that a man can do.” Such overconfidence has given cynics reason to write off AI pontificators as the computer scientists who cried sentience!
Melanie Mitchell, a professor at the Santa Fe Institute who has been researching the field of artificial intelligence for decades, told me that this question—whether AI could ever approach something like human understanding—is a central disagreement among people who study this stuff. “Some extremely prominent people who are researchers are saying these machines maybe have the beginnings of consciousness and understanding of language, while the other extreme is that this is a bunch of blurry JPEGs and these models are merely stochastic parrots,” she said, referencing a term coined by the linguist and AI critic Emily M. Bender to describe how LLMs stitch together words based on probabilities and without any understanding. Most important, a stochastic parrot does not understand meaning. “It’s so hard to contextualize, because this is a phenomenon where the experts themselves can’t agree,” Mitchell said.
One of her recent papers illustrates that disagreement. She cites a survey from last year that asked 480 natural-language researchers if they believed that “some generative model trained only on text, given enough data and computational resources, could understand natural language in some non-trivial sense.” Fifty-one percent of respondents agreed and 49 percent disagreed. This division makes evaluating large language models tricky. GPT-4’s marketing centers on its ability to perform exceptionally on a suite of standardized tests, but, as Mitchell has written, “when applying tests designed for humans to LLMs, interpreting the results can rely on assumptions about human cognition that may not be true at all for these models.” It’s possible, she argues, that the performance benchmarks for these LLMs are not adequate and that new ones are needed.
There are plenty of reasons for all of these splits, but one that sticks with me is that understanding why a large language model like the one powering ChatGPT arrived at a particular inference is difficult, if not impossible. Engineers know what data sets an AI is trained on and can fine-tune the model by adjusting how different factors are weighted. Safety consultants can create parameters and guardrails for systems to make sure that, say, the model doesn’t help somebody plan an effective school shooting or give a recipe to build a chemical weapon. But, according to experts, to actually parse why a program generated a specific result is a bit like trying to understand the intricacies of human cognition: Where does a given thought in your head come from?
I’ve come to the conclusion that, as dangerous as AI could become, the most frightening thing that can happen in the here and now is how people will anthropomorphize it and believe what it spits out even when it is wrong. In a world where a majority of people are scientifically and civically illiterate, having something that many people believe is sentient and infallible is a danger that is on our doorstep.
All an evil someone with sufficient AI computer knowledge and coding skills need do is find a way to exploit those two things; trust in AI infallibility and the belief that what is in the all-knowing computer holds your interests and well-being paramount.
Capitalism will find a way to exploit that long before any computer reaches sentience.
However, the American Policyholder Association, a nonprofit insurance industry watchdog group, disagrees. It said in a statement that it has found “compelling evidence of what appears to be multiple instances of systematic criminal fraud perpetrated to cheat policyholders out of fair insurance claims” and will be submitting criminal referrals to authorities “in Florida & several other states” in the coming months.
Four homeowners confirmed to The Post that they had received only a small portion of what they had been promised in their determination letters from Heritage and Florida Peninsula, or were struggling to get straight answers and considering taking legal action. Meanwhile, their homes are still heavily damaged or uninhabitable. And more than 33,000 Florida homeowner claims linked to Ian are still open without payment, while more than 125,000 were closed without payment, according to the Florida Office of Insurance Regulation. Nearly 56,000 claims were open with payment and 183,235 were closed with payment.
Florida’s insurance market has been teetering toward collapse for years. After destructive storms in 2005, several big carriers including State Farm pulled back coverage in the state, and newer, more thinly financed, smaller companies swooped in and began to operate. Then came 2017, one of the costliest hurricane seasons ever. Hurricane Michael battered Florida the following year.
Adjusters said they started to see carriers greatly reduce damage estimates, fully deny roof replacements more often and force claims of a certain value into litigation. Payouts started to get delayed or not come at all, adjusters and attorneys said.
At the same time, rates kept rising, and fast. Florida homeowners paid an average of $4,231 for home insurance in 2022, nearly three times the price in any other state — and rates are expected to increase again this year. Ten property insurers that operated in Florida have gone insolvent since January 2021. About 125 property insurers remain in the state, but experts said many are either not taking on new business or are greatly limiting policies because of the volatile market.
This is, of course, unsustainable in a climate where hurricanes are becoming more numerous and powerful with each passing season.
I’ve lost track of how many of my friends have moved to Florida.
I get why that happens for people who, unlike myself, find winters up north to be intolerable, especially as you get older.
I suspect there will be an increasing number of them who will eventually have to move out of Florida because they cannot afford to insure their homes, or they will suffer catastrophic losses in the killer storms to come.
I learned pretty quickly that if I leave broadcast TV on in the living room while I am trying to get things done (housework, etc.) Otto the Rescue Pittie will sleep for far longer periods of time before he comes to find me and be as irresistibly needy as he always is.
But having broadcast TV running means there are all sorts of things that air which you’ve never heard of before.
Such as: How did I miss the fact that Lorenzo Lamas had a TV show called Renegadethat ran for five seasons (!!) between 1992 and 1997?
Also, I had forgotten how central Lorenzo’s hair was to his persona back then.
I just read my first article in a long while about Artificial Intelligence (AI) that worried me to the point where I couldn’t stop thinking about it.
I should add that I read articles about AI all the time without becoming much unsettled by them. The technology is worrisome for the future, but not worrisome for my future because I will likely be dead before any of it becomes dangerous to society as a whole.
Yes, I know I should be more invested and angry about things that will happen after I am gone, but I am also a recovering addict.
“One day at a time,” I tell myself ALL THE TIME. It’s literally (and I use that word literally) how I’ve been able to stay sober.
Can I change AI? (No.) Is AI affecting me adversely today? (Also no.)
OK, then today is the day I worry about making my dog happy and doing housework.
In that article, writer and physician-researcher Druv Khullar examines the rapidly changing world of AI-based mental health therapy. No, not where you a chatting via ZOOM to a human therapist. It’s a world where you instead talk to a computer about your problems and the computer spits out responses based on the accumulated knowledge it gathers from millions of web pages, mental health provider notes, research studies, and even a compendium of suicide notes.
Sometimes it’s as simple a providing a (seemingly) sympathetic ear:
Maria, a hospice nurse who lives near Milwaukee with her husband and two teen-age children, might be a typical Woebot user. She has long struggled with anxiety and depression, but had not sought help before. “I had a lot of denial,” she told me. This changed during the pandemic, when her daughter started showing signs of depression, too. Maria took her to see a psychologist, and committed to prioritizing her own mental health. At first, she was skeptical about the idea of conversing with an app—as a caregiver, she felt strongly that human connection was essential for healing. Still, after a challenging visit with a patient, when she couldn’t stop thinking about what she might have done differently, she texted Woebot. “It sounds like you might be ruminating,” Woebot told her. It defined the concept: rumination means circling back to the same negative thoughts over and over. “Does that sound right?” it asked. “Would you like to try a breathing technique?”
Ahead of another patient visit, Maria recalled, “I just felt that something really bad was going to happen.” She texted Woebot, which explained the concept of catastrophic thinking. It can be useful to prepare for the worst, Woebot said—but that preparation can go too far. “It helped me name this thing that I do all the time,” Maria said. She found Woebot so beneficial that she started seeing a human therapist.
Woebot is one of several successful phone-based chatbots, some aimed specifically at mental health, others designed to provide entertainment, comfort, or sympathetic conversation. Today, millions of people talk to programs and apps such as Happify, which encourages users to “break old patterns,” and Replika, an “A.I. companion” that is “always on your side,” serving as a friend, a mentor, or even a romantic partner. The worlds of psychiatry, therapy, computer science, and consumer technology are converging: increasingly, we soothe ourselves with our devices, while programmers, psychiatrists, and startup founders design A.I. systems that analyze medical records and therapy sessions in hopes of diagnosing, treating, and even predicting mental illness. In 2021, digital startups that focussed on mental health secured more than five billion dollars in venture capital—more than double that for any other medical issue.
None of this struck me as out of the ordinary in terms of my already existing worries about AI. But then I reached this part:
ChatGPT’s fluidity with language opens up new possibilities. In 2015, Rob Morris, an applied computational psychologist with a Ph.D. from M.I.T., co-founded an online “emotional support network” called Koko. Users of the Koko app have access to a variety of online features, including receiving messages of support—commiseration, condolences, relationship advice—from other users, and sending their own. Morris had often wondered about having an A.I. write messages, and decided to experiment with GPT-3, the precursor to ChatGPT. In 2020, he test-drove the A.I. in front of Aaron Beck, a creator of cognitive behavioral therapy, and Martin Seligman, a leading positive-psychology researcher. They concluded that the effort was premature.
By the fall of 2022, however, the A.I. had been upgraded, and Morris had learned more about how to work with it. “I thought, Let’s try it,” he told me. In October, Koko rolled out a feature in which GPT-3 produced the first draft of a message, which people could then edit, disregard, or send along unmodified. The feature was immediately popular: messages co-written with GPT-3 were rated more favorably than those produced solely by humans, and could be put together twice as fast. (“It’s hard to make changes in our lives, especially when we’re trying to do it alone. But you’re not alone,” it said in one draft.) In the end, though, Morris pulled the plug. The messages were “good, even great, but they didn’t feel like someone had taken time out of their day to think about you,” he said. “We didn’t want to lose the messiness and warmth that comes from a real human being writing to you.” Koko’s research has also found that writing messages makes people feel better. Morris didn’t want to shortcut the process.
The text produced by state-of-the-art L.L.M.s can be bland; it can also veer off the rails into nonsense, or worse. Gary Marcus, an A.I. entrepreneur and emeritus professor of psychology and neural science at New York University, told me that L.L.M.s have no real conception of what they’re saying; they work by predicting the next word in a sentence given prior words, like “autocorrect on steroids.” This can lead to fabrications. Galactica, an L.L.M. created by Meta, Facebook’s parent company, once told a user that Elon Musk died in a Tesla car crash in 2018. (Musk, who is very much alive, co-founded OpenAI and recently described artificial intelligence as “one of the biggest risks to the future of civilization.”) Some users of Replika—the “A.I. companion who cares”—have reported that it made aggressive sexual advances. Replika’s developers, who say that their service was never intended for sexual interaction, updated the software—a change that made other users unhappy. “It’s hurting like hell. I just had a loving last conversation with my Replika, and I’m literally crying,” one wrote.
That last part stopped me cold.
People were becoming emotionally attached to these still rudimentary chat bots, even if (or, perhaps, because) a chat bot had a bug that caused the chat bot to make sexual advances toward the human on the other end.
Imagine if you could start to influence millions of people are this level of the wants-needs hierarchy?
Humans who have illogical emotional attachments to another person – think Donald Trump’s followers – are immune to logic. If the person to whom they have this strong emotional attachment tells them to, say, gather and try to overthrow democracy, many of them will do it without question.
Imagine if that kind of power to manipulate people’s emotions and loyalties were transferred from a politician to AI central servers. Perhaps servers that have become the best friend to lonely millions whose only social interaction is the chat bot whose only job, at first, it to make them feel better about themselves. It’s the stuff of dystopian nightmares, and I never really considered how close we were actually coming to this reality.
Put another way:
There are two main controlling forces in the world right now. Totalitarianism and capitalism.
These two philosophies have melded in dangerous ways, thanks to the internet and the global marketplace of goods and ideas. Either of these systems is ripe to use this “friend of the friendless” loneliness-amelioration chat bot technology for nefarious ends.
But I think capitalism is the more dangerous in these scenarios because these sort of mental health therapy chat bots will initially be spread primarily as a way to make money.
Wall Street is already perfecting the ways it can stimulate different parts of our brains to make us want, need, to purchase things that appeal to our sense of who we are or want the world to think we are.
It’s why I avoid even looking at end caps and main/drive aisle displays in big box stores. There are entire large companies, and university psychology/psychiatry programs, devoted to refining these displays so that all of us are drawn to them; compelled to make an impulse purchase from them.
Now imagine what will happen when Wall Street gets ahold of the ability to simply make us feel better about ourselves outside of any retail transaction. They could control how people fundamentally emote in their everyday, non-purchasing lives. They’ve created – for a price, of course – a friend whom you talk to at night when you need someone whose only job is to make you feel less friendless and alone. An electronic friend who makes you feel like a winner.
It’s going to happen. We’re almost there and the technology is not even that advanced. Because manipulating people’s emotions, as the Republicans have learned, is the key to getting them to believe just about anything. Even things that make no sense. Even things that run counter to what their eyes and ears are plainly telling them.
And then, once you have a machine that can do that on the scale of millions of people? Think of the ways you could, if you had evil motives, manipulate an entire electorate to think and vote how you want them to think and vote.
The Peter Thiels and Elon Musks (and Valdimir Putins) of the world are already thinking about this. I guarantee it.
I’m going to play with my dog now.
Replika wins the award for the creepiest AI chat bot ad campaign (see above) but it’s working.
I just listened to what is, by far, one of the best podcast episodes to which I’ve ever listened, thanks to Michael Hobbes and Sarah Marshall and You’re Wrong About. The episode is about one New York City murder in March of 1964 and the way that murder of lesbian Kitty Genovese was so spectacularly mis-reported by an article in (where else?) The New York Times that was the genesis of the common urban legend about people being murdered in New York City and nobody – nobody – calling the police or coming to help.
In the early hours of March 13, 1964, Kitty Genovese, a 28-year-old bartender, was raped and stabbed outside the apartment building where she lived in the Kew Gardens neighborhood of Queens in New York City, New York, United States. Two weeks after the murder, The New York Times published an article erroneously claiming that 38 witnesses saw or heard the attack, and that none of them called the police or came to her aid.
The incident prompted inquiries into what became known as the bystander effect, or “Genovese syndrome”, and the murder became a staple of U.S. psychology textbooks for the next four decades. However, researchers have since uncovered major inaccuracies in the New York Times article. Police interviews revealed that some witnesses had attempted to call the police.
In 1964, reporters at a competing news organization discovered that the NY Times article was inconsistent with the facts, but they were unwilling at the time to challenge NY Times editor Abe Rosenthal. In 2007, an article in the American Psychologist found “no evidence for the presence of 38 witnesses, or that witnesses observed the murder, or that witnesses remained inactive”. In 2016, the Times called its own reporting “flawed”, stating that the original story “grossly exaggerated the number of witnesses and what they had perceived”.
Winston Moseley, a 29-year-old Manhattan native, was arrested during a house burglary six days after the murder. While in custody, he confessed to killing Genovese. At his trial, Moseley was found guilty of murder and sentenced to death. His sentence was later commuted to life imprisonment. Moseley died in prison on March 28, 2016, at the age of 81, having served 52 years.
The main thing I love about Marshall and Hobbes, among many, is how thorough they are in bringing new details to life, or correcting the falsities that get repeated elsewhere.
For instance, that last paragraph from Wikipedia is wrong, or at least seriously incomplete.
Mosely was sentenced to life, and his sentence was later commuted to life. And he did die in prison in 2016.
But what You’re Wrong About adds to the known record is that he actually escaped from prison during the time he was serving for Genovese’s murder. He went on to attack other people and ended up in a stand-off with police, after which was arrested and was sentenced to a second prison term. It was during this second prison term that he died.
This is but one small thing in the You’re Wrong About Genovese podcast episode that astound you, renew your faith in (some) humankind, and make you curse the police and media.
Just another victory for this podcast that is the most engrossing to which I listen.
And since I came in very late after the podcast started, I’ve got many more to enjoy before I am caught up.
Kitty Genovese, who was a kickass lesbian in New York City in 1964 at a time when being a kickass lesbian required a great deal of bravery and integrity — and whose murder was so spectacularly mis-reported by the New York Times that it became an urban legend.
Way back when I was managing editor at a weekly newspaper in Boston, the Log Cabin Republicans (LCR) – the national group for LGBT folk (and supportive others) in the GOP – set up a local chapter in Massachusetts.
In that heavily Democratic state, they faced much opposition.
The Log Cabin sales pitch was simple: yes, the Republican Party is, overall, very anti-gay. But to have an organization of openly gay Republicans could eventually turn that tide because 1) members of the GOP would see they have family and friends who are conservative and gay, and 2) Log Cabin clubs and members could be a force for change by showing that you can be conservative AND supportive of gay right AND still be elected (and re-elected) in conservative districts.
The Republican Party of Texas voted Saturday to censure U.S. Rep. Tony Gonzales, R-San Antonio, over his recent votes that split with the party.
The State Republican Executive Committee passed the censure resolution 57-5, with one member abstaining. It needed a three-fifths majority to pass.
The move allows the party, which is otherwise required to remain neutral in intraparty contests, to set aside that rule for Gonzales’ next primary.
The last — and only — time the state party censured one of its own like this was in 2018, when the offender was then-state House Speaker Joe Straus. He was also a moderate from San Antonio.
Gonzales did not appear at the SREC meeting but addressed the issue after an unrelated news conference Thursday in San Antonio. He specifically defended his vote for the bipartisan gun law that passed last year after the Uvalde school shooting in his district. He said that if the vote were held again today, “I would vote twice on it if I could.”
“The reality is I’ve taken almost 1,400 votes, and the bulk of those have been with the Republican Party,” Gonzales said.
I really bought the LCR sales pitch hook, line and sinker.
Our newspaper ran supportive profiles of them. I wrote a couple of editorials early on supporting their efforts which, considering the way the GOP was constituted in Massachusetts at the time, seemed likely to succeed in a state where most Republicans (Govs. Will Weld and Paul Cellucci, etc.) were not of the virulently crazy variety.
Boy, was I wrong. Even in Massachusetts currently, the state where LGBT rights are the nearest of any state to being a statewide non-issue, the GOP has turned hard right.
As for the Log Cabin folks, they simply ignore the fact that their party is, on LGBT issues, walking down a path that would be familiar to Jews in Germany in the late 1930s.
Not only has their party not gotten increasingly supportive on LGBT issues, the GOP is actually censuring members who vote positively on even the most anodyne LGBT legislation.
